The government's key measure of inflat­ion recorded a surprise rise last month as a plunging pound, a surge in food prices and the rising cost of beer, wine and spirits allayed City fears of deflation.

After declining for the past five months, the consumer prices index was up from 3% in January to 3.2% in February.

The jump forced Mervyn King, the governor of the Bank of England, to write to Alistair Darling explaining why inflation had deviated more than a percentage point from the government's 2% target. King said there were signs that the 28% tumble in sterling since summer 2007 had fed through into higher prices in the shops, since the pick-up in inflation appeared to be concentrated on imported goods.

An alternative measure of the cost of living, the retail prices index (RPI), fell by less than expected last month, from 0.1% to zero, but failed to turn negative as the City had predicted.

Both King and City economists believe the rise in CPI will prove temporary, since cuts in domestic energy bills will reduce inflation by a percentage point when they show up over the coming months. "We [the Bank's monetary policy committee] believe that the sharp decline in the CPI inflat­ion since it peak in September is likely to resume in the coming months," King said in his letter.

A breakdown of the data showed food prices up 12.5% in the year to February, with meat and vegetables big contributors. Officials said poor weather in Spain pushed up the cost of seasonal items.

Brewers blamed the steepest increase in alcohol prices since 1992 – up 5.4% in the year to February – on double digit duty rises and the decision by the chancellor to exempt alcohol from the temporary cut in VAT to 15% in December.

Industry campaigners say that has contributed to about 2,000 pub closures in the last 12 months. According to the British Beer and Pub Association alcohol consumption fell by just over 3% last year.

Meanwhile, sterling hit a six-week high against the dollar after the numbers were released. It rose by more than half a cent to $1.4778.

City analysts agreed with King. James Knightley at ING said: "Utility tariff cuts will be feeding through very strongly from the March report onwards, while weaker economic activity will also constrain corporate pricing power and help to drive inflation lower in coming months."

In comments to the Treasury select committee, King admitted that the inflat­ion figures were higher than he and the MPC expected. "With a 28% fall in the exchange rate over 18 months, we clearly expected a good part of that to feed through to the domestic price level. What was unclear was precisely how much and at what speed it would come through." He added: "I see no reason why [sterling] should go any lower."

King added that the Bank may spend less than the planned £75bn on buying government bonds if the quantitative easing programme succeeds in unfreezing credit markets. The June gilt future tumbled by more than two points to a three-week low of 120.70 on the comments.

The ONS data also showed that RPI – the broadest measure of inflation, which includes mortgage payments and housing costs – slipped to an annual rate of 0% last month, defying expectations of a decline into negative territory, or deflation.

It was the weakest reading since March 1960, the last time Britain suffered a period of price deflation.

Economists think the RPI may drop as low as -4% this year as tumbling interest rates, mortgage costs and the reduction in energy bills feed through.

Philip Shaw, chief economist at Investec, said: "RPI inflation is stubbornly avoiding going into negative territory, but we think it's only a matter of time before it does."

If the RPI turns negative in coming months as expected, many workers will suffer because the index is used as a benchmark in wage negotiations.

As falling earnings prompt a sharp decline in consumer spending, a prolonged period of deflation could push Britain's economy into the kind of stagnation suffered by Japan in the 1990s and into this century.

Underlining the severity of the economic situation, the Bank's labour market expert, David Blanchflower, warned today that the unemployment rate – currently at 6.5% – could be in double figures by the end of the year.

Pensions and state benefits are also calculated on the basis of RPI, although pensioners will not suffer as much as feared, at least not for a while. Each spring, the state pension is raised in line with RPI from the previous September. This year pensioners will benefit from the fact that RPI hit a record high of 5% last September driven by surging oil prices.

The government has also pledged not to reduce any state benefits, which will be raised by 5% or 6.3% by 5% on 6 April.

The gap between the two measures of inflation is the biggest since records began in 1989, as aggressive interest rate cuts have pushed RPI sharply lower, while CPI excludes mortgage and housing costs.